EMPLOYERS retain employees by providing lower pay following the low labour demand during the Covid-19 pandemic, said Chief Statistician Mohd Uzir Mahidin.

He said although it is a good short-term alternative, it will affect work quality and workers’ well-being in the long run.

The labour market is now facing challenges to remain competitive following the Covid-19 pandemic, and issues of unemployment and structural unemployment, among others, have to be tackled to ensure the country can recover, he added.

“Structural unemployment can be linked to the slow demand for labour in the skilled job category.

“This shows that industries are facing a problem to absorb the supply of tertiary educated labour or workers with jobs that match their educational background.”

Uzir said the economic sector’s reduced operating hours has increased the time-related underemployment rate to 2.2% in the third quarter of this year, from the quarterly average of 1.3% in 2019.

“The rise of employment involving those who can afford and are willing to have more working hours in this category can be linked to the transition to a flexible job arrangement in terms of time and place of work,” he said, adding that gig workers are included in the category.

The labour market is recovering and recorded a lower unemployment rate of 4.3% in October, with 705,000 unemployed people. But it still surpasses the pre-pandemic rate, which is around 3.3% (500,000 unemployed people), despite being the lowest rate recorded since March last year.

“Most countries, including Canada, the United Kingdom and the United States, have not been able to get their unemployment rate back to pre-pandemic levels,” said Uzir. – Bernama, December 16, 2021.